Is the high street dead? Surely not.
PUBLISHED: 16:06 10 October 2018
Is the high street dead? Mike White, from Martin & Co, discusses the future of the high street for letting agents.
Confusing isn’t it? Everyday, we hear new stories of doom and gloom in all sectors of the economy and yet look around in Norwich. Lots of cranes on the skyline which is always an indicator of economic confidence, new shops and restaurants opening regularly, crowds of people wandering up and down Gentleman’s Walk. It’s the same in the world of landlords and lettings – loads of doom and gloom in the national press and on the airwaves; stories abound about the number of landlords selling up, how stretched financially agents are becoming and how online only agents are killing off those with high street premises. And, yet, here again what we’re seeing in practice in this part of the world doesn’t necessarily support this.
However, there is no doubt with the tenant fee ban looming, we are already seeing a consolidation within the lettings industry and this is only likely to accelerate the nearer we get to the ban.
The question is, is such consolidation combined with the rise of online only agents going to be good or bad for the consumer? Well, for sure, life moves on and the way business is conducted across all sectors changes over time. Just cast your mind back to, say, 1993 and look how much has changed in that short 25 year time-frame. Who would have thought then that one fifth of all adults would now be living in rented accommodation or that the average middle income, middle aged person would have the wherewithal to be their landlord! But here we are, a whole industry has been spawned that is now as much part of the social fabric as having a cup of tea. So much so, that populist political parties of all colours are now taking such a great interest in it. Effectively, the manipulation of the industry by the government – tax changes, fee bans, incentives for corporate landlords et al, is a form of social engineering and we would all be right to be wary of the longer term effects that might have.
But what is the impact of online only agents going to be on the consumer? Personally, I think it’s a complete myth that online agency is better for landlords, there again, I would say that, wouldn’t I? Nonetheless, for all the hubris and hyperbole we see across the national media about how wonderful they are, the fact is online only agents for all the money they have collectively thrown at the collective enterprise, still after all this time, only have a market share of around 5 per cent. Let’s not forget, in reality, an agent who has a website and uses the property portals to advertise its properties, is effectively an online agent anyway – so that’s about 98 per cent then! As far as I can see, the so-called online only agent is useful for a DIY landlord who fundamentally doesn’t like using agents but wants their property to be listed on the likes of Rightmove.
The good thing about corporates growing larger is they will need (and want) to retain their high street presence and just as new shops and restaurants replace closed ones, so are new agents springing up. For landlords who are trusting their most valuable asset, other than their own home, to an agent to look after, there is something very reassuring about knowing that your agent has a real local office, in a real place with real people in it. Long live the High Street!
For a chat with a real independent lettings specialist, give me a call at Martin & Co Norwich on 01603 766860 or pop into a real office at 1 Charing Cross to meet our real people!
Martin & Co has sponsored this column.